The RRSP gives you a tax DEDUCTION going in AND tax-deferred growth. The biggest win: US dividend stocks have NO 15% withholding here (vs TFSA/non-reg where they do). Hold your US dividend ETFs in your RRSP.
See 4 strategies →Maximize US dividends — RRSP avoids 15% US withholding via tax treaty.
One-fund global equity. Auto-rebalances. Perfect default.
Classic balanced. Single ETF replaces 7-fund portfolio.
Lower volatility for those nearing retirement.
Canada-US tax treaty exempts US-source dividends paid to RRSP from 15% withholding. Inside TFSA: 15% withheld. Inside non-reg: 15% withheld but you get foreign tax credit.
High-tax income (interest, REIT distributions) get TAX-DEFERRED here. Outside RRSP, this income is fully taxable at marginal rate.
Canadian dividends get the Dividend Tax Credit OUTSIDE RRSP (effective 0-25% tax). Inside RRSP, they're fully taxed at withdrawal — wasted credit.
Reduces taxable income on every paycheck. Plus you avoid the "lump sum" March 1 deadline panic.
Interest on RRSP loans is NOT tax-deductible (unlike non-registered margin loans). The math rarely works.
Mandatory by Dec 31 of year you turn 71. Plan ahead — calculate your minimum withdrawals and tax bracket.